Acquisition of Siriusware Inc ("Siriusware")

RNS Number : 7502U

Accesso Technology Group PLC

05 December 2013

 



5 December 2013

accesso® Technology Group plc

("accesso" or the "Group")

Acquisition of Siriusware Inc ("Siriusware")

 - Acquisition of ticketing and point-of-sale software solutions company for total consideration of £8.0m -

- Strengthens accesso's existing product offering, extends reach to new verticals including the ski and snow sports sector, and presents significant cross-selling opportunities into a broad customer base -

- Acquisition expected to be immediately earnings accretive -

accesso Technology Group plc (AIM: ACSO), the premier technology solutions provider to the global attractions and leisure industry, is pleased to announce the acquisition of Siriusware ("Siriusware")(the "Acquisition"): a leading North American provider of ticketing and point-of-sale ("POS") software and hardware solutions and professional services to the leisure industry, with particular strength in the ski and snow sports sector.

Acquisition Highlights

The Directors believe that Siriusware will:

·      Provide accesso with direct access into new leisure industry verticals, in particular the ski and snow sports  sector and cultural attractions;

·      Increase accesso's penetration in existing verticals, such as amusement parks and waterparks;

·      Present opportunities to cross-sell its range of products and services to an expanded customer base. In particular, targeting accesso's eCommerce solutions at Siriusware's existing customers and Siriusware's POS solutions into accesso's customers;

·      Enhance accesso's ability to develop new products and integrated value-added services for customers, particularly in POS, by combining the strong IP and product development skills of both companies;

·      Provide incremental recurring revenue streams through Siriusware's ongoing license and technical support model;

·      Strengthen accesso'smanagement team, with Siriusware's current President and CEO, Mark Danemann, becoming President of Siriusware Inc., and other key staff remaining with the enlarged Group in key management positions; and

·      Be immediately earnings accretive.

Commenting on the Acquisition, Tom Burnet, Chief Executive of accesso said:

"I am delighted to announce our acquisition of Siriusware: an immediately earnings accretive move that will take us into new markets, new geographies and strengthen the already world-class technology platform we have here at Accesso. This acquisition aligns two likeminded teams and two highly complementary product offerings that, together, can unlock greater value in traditional markets and in new ones. We firmly believe that this deal is a sound use of funds and one which will deliver good returns in the years ahead."

Commenting on the Acquisition, Mark Danemann, President and Chief Executive Officer of Siriusware said:

"We are thrilled to join forces with Accesso, a firm we have greatly respected for many years, and firmly believe we can deliver even more value to current and future customers by working together to further expand our innovative solutions. Being part of the Accesso team presents an exciting opportunity to expand the innovation and reputation we have built into new markets, new clients and even new corners of the world.  I look forward to working together to meet the rapidly changing needs across the leisure industry."

Overview of Siriusware

Siriusware is a private company, based in the U.S, which offers a fully integrated suite of software and hardware solutions and professional services to the leisure industry. Siriusware has historically focused on delivering its solutions to the ski and snow sports industry, which contributed over 50% of FY2012 revenue. In recent times Siriusware has successfully built upon its strong position in the ski and snow sports market and diversified into amusement parks and water parks, cultural attractions such as museums, aquariums and science centres, and into a broad range of other entertainment sites. The Company now services more than 250 venues.

Siriusware offers its customers an integrated POS solution and targets operators of attractions which, like accesso's own operator customers, have a general admissions component. It offers these operators a range of services to help them manage and maximise value from this component, including ticketing & admissions, membership and pass provision, on-site retail, integrated credit and debit card processing and club management, amongst other functions. Siriusware also provides hardware and equipment, such as access controls and scanners, and professional services including implementation, custom reporting, consulting and enhancements.

Rationale for the Acquisition

The Directors of accesso believe that the Acquisition is strategically compelling and highly complementary to accesso's existing operations, customer base, product and service offering. The Directors see significant potential for Siriusware to expand accesso's product offering, complement its technology platform and bring additional skills that will enable the Group to move more quickly toward its goal of becoming a leading provider of end-to-end solutions to the attractions and leisure industry.

There is minimal overlap between accesso and Siriusware's respective customer bases, which presents a significant opportunity to cross-sell existing product solutions. The addition of these new customer relationships is expected to create new areas of growth for the enlarged group as well as enhance existing client relationships. Furthermore the Acquisition has the potential to augment and deepen accesso's product offering within its existing client relationships with the availability of Siriusware's retail, rental and food point-of-sale solutions.

The Acquisition provides accesso with direct access into new areas of the leisure industry, in particular the ski and snow sports sector, which has historically been an anchor market for Siriusware's POS solutions, as well as the opportunity to leverage accesso's industry leading eCommerce platform to the expanded customer group. In addition, there is scope to increase penetration for both companies into markets where accesso currently has a strong presence, such as amusement parks and waterparks as well as expand Siriusware into new geographic markets currently served by accesso.

As such, the Board believes that this acquisition represents an excellent use of Group resources, enabling it to deliver future growth from a broader, more balanced mix of end-markets.

Terms of the Acquisition

Under the terms of the Acquisition, accesso will purchase 100% of the entire issued share capital of Siriusware from the selling shareholders (the "Vendors"), for a total consideration of US$13.0m (£8.0m) (the "Total Consideration"). At the time of the Acquisition Siriusware has net cash on its balance sheet of US$1.2m (£0.7m). The Total Consideration consists of the following: US$7.8m (c.£4.8m) in cash at completion (the "Initial Cash Consideration") and the issue of 473,130 new ordinary shares of 1 penny each (the "New Ordinary Shares") in accesso (equating to approximately 2.3 per cent of the Group's enlarged issued share capital) (the "Initial Stock Consideration").

The Vendors include President, Chief Executive Officer and majority shareholder of Siriusware, Mark Danemann, and current employees of Siriusware.

Application has been made for the admission of 473,130 New Ordinary Shares, being the Initial Stock Consideration, to trading on AIM. It is expected that dealings in these New Ordinary Shares, which will rank pari passu in all respects with the existing ordinary shares of the Company, will commence on 10 December 2013. Following the issue of the New Ordinary Shares, the issued share capital of the Company will comprise 20,199,011 ordinary shares.

Lock-up restrictions

349,104 of the 473,130 New Ordinary Shares are subject to lockup restrictions for a period of 24 months from the date of completion.

Financial Information

For the full year ended 31 December 2012, Siriusware generated audited revenues of US$8.1m (£4.9m) and loss before tax of US$0.42m (£0.26m), and had net assets of US$0.76m (£0.46m) at 31 December 2012. During 2013 Siriusware has experienced revenue growth of approximately 25%, which has resulted in year on year growth in earnings, and building on this strong growth trajectory, accesso expects the Acquisition to be immediately earnings enhancing.

Extension of Debt Facility

The Group has extended its current banking facility with Lloyds Bank Commercial Banking ("Lloyds") (the "Extended Facility"). The Extended Facility allows the Group to draw down up to £8.5m at an agreed rate of 1.5% above LIBOR on drawings up to £5m (this tranche is due to expire in February 2017) and 2% above LIBOR on drawings above £5m (this tranche is due to expire in December 2015 and is subject to meeting certain post acquisition obligations prior to drawdown). The agreed rate on uncommitted funds is 0.6% and 0.8% on the respective elements. The total available for drawdown is subject to annual reductions of £2m on each anniversary of the facility.

The Extended Facility, which is US dollar denominated, has been secured on accesso's assets and intellectual property ("IP") in the US and UK, an indication of the value of the accesso technology in the market, and the confidence the finance community has in the accesso business.

For further information, please contact:

accesso Technology Group plc	[phone]
Tom Burnet, Chief Executive Officer
John Alder, Chief Financial Officer
FTI Consulting, LLP	[phone]
Matt Dixon, Lucy Delaney, Jessica Liebmann
Canaccord Genuity Limited	[phone]
Simon Bridges, Cameron Duncan, Brendan Gulston

accesso® Technology Group: about us

accesso (AIM: ACSO) is the premier technology solutions provider to the global attractions and leisure industry. Our patented and award-winning solutions drive increased revenue for attraction operators by significantly improving the most important part of an attraction visit: the guest experience.  Our solutions add value to operators at every point in the guest journey:

·      We drive attendance

The accesso Passport^SM ticketing suite is a comprehensive, easy-to-use cloud solution that processes many millions of ticket and season passes every year, enabling operators to maximise up-sell and cross-sell with ease to drive greater revenue.

·      We handle payments

Our payment gateway carries level 1 PCI security certification and 24/7 support.  It provides the tools, security and support operators need to drive sales and has so far processed more than $5 billion in transactions.

·      We take guests out of line

Since 2001 over nine million guests have used a patented accesso LoQueue^SM solution to queue less, ride more, enjoy a better experience and increase their in-attraction spend.

·      We increase engagement

accesso enables operators to engage more deeply and profitably with guests: pre-sale, in-attraction or post-visit.  Our mobile apps have provided more than 2.75 million people with rich iOS and Android content to better plan their visit, buy their ticket on-the-go and unlock new experiences within an attraction. 

Over 140 attractions worldwide currently employ accesso technology - from theme parks, to water parks, cultural attractions and sporting events.  We are proud that our solutions are trusted by the majority of the leading names in the leisure industry, including Six Flags Entertainment, Cedar Fair Entertainment Merlin Entertainments, International Speedway Corporation, Palace Entertainment, Compagnie des Alpes, and Herschend Family Entertainment.

accesso is a public company, listed on AIM: a market operated by the London Stock Exchange.

For more information visit www.accesso.com 

About Siriusware

Siriusware is a leading ticketing and guest management point-of-sale technology provider to the attractions and leisure industries, with a particularly strong presence in the ski and snow sports sector.

Founded in Taos, NM in 1989 out of a passion for outdoor activities and a love of beautiful places, the company was launched with a focus on the ski industry, which it soon came to dominate.   Seeing opportunity to expand, the company identified complementary opportunities in amusement and water parks, museums and attractions.

Today, the solution is used at more than 250 sites in six countries.  In addition to ticketing, Siriusware offers membership, retail, food and beverage, group scheduling, reservations and a host of other solutions all completely integrated into a seamless package.

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